Orchard Funding Share Discussion Threads

[gbcol] 14/2/2023 14:08

Also, where was the holding notification for going under 3%?

“ A person must notify the issuer of the percentage of its voting rights he holds as shareholder or holds or is deemed to hold through his direct or indirect holding of financial instruments falling within DTR 5.3.1R (1) (or a combination of such holdings) if the percentage of those voting rights:

(1) reaches, exceeds or falls below 3%, 4%, 5%, 6%, 7%, 8%, 9%, 10% and each 1% threshold thereafter up to 100%”

[battlebus2] 14/2/2023 13:31

I agree, whilst maybe nothing negative was meant the look is certainly bad

[playful] 14/2/2023 13:23

I think David makes a fair point with being a major shareholder comes with a degree of responsibility particularly in a small illiquid company such as ours and selling 500K shares so quickly whilst talking them up just isn't cricket.

[davidosh] 14/2/2023 13:07

97peter....Investors seem to be getting wary of your comments here. It is pretty clear that you are buying and selling significant numbers of shares whilst also claiming you are close to the directors and acting as a consultant.

You are also very bullish with your comments on here so that means you are giving indications that investors should buy or increase their holding whilst the likelihood is that you are trading the stock and selling !!

Is that an unfair assessment and more importantly for me, do you think that is fair to fellow shareholders to be trading the stock whilst claiming investor relations and website improvements are coming that never materialize?

I hate having to mention this but as a big supporter of investor engagement and clarity of information I think you need to clearly state whether a buyer or seller at the time of your postings.

[97peter] 14/2/2023 12:34

All, my buy in and sell is purely to enable me as retired to invest wisely my drawdown SIPP pot! This company is well run!
The Investor Relations pages will be another 2 week before ready!
See the website and look at the SaaS LENdXP and Trustloop for its potential!! Plus their bond!! Plus with contracts and solid returns what’s not too like? I would forget the idea of share buyback but please do Q&A Ravi via Investor Relations link and e mail!!

[brianblu] 14/2/2023 11:25

Must be a buckfast drinker 🤡

[papy02] 14/2/2023 11:22

Hmmmmm :

Post 235, 27th Jan. ... as a big 3% of company investor, part time consultant and big backer of AIM. I can only ask you to ...
Comment: 3% of 21.35m = 640k

Post 247, 6th Feb. ... Great time to buy, I am trickling a few extra 1,000 and 5,000 buys as and when other divis from other shares comes in.

Post 266, 13 Feb ... I have 210,000 which are a LTH.

Post 269, 14th Feb. ... But I am now buying back in and intend to get to around 1,100,000 shares or around 4%. Then I will just sit and take the £30,000 a year to live on. I have always been in and out and luckily now my average at 311,190 shares is46p.

[brianblu] 14/2/2023 11:09

Yes not protocol to not show trades Langland 🤔 poor stuff

[playful] 14/2/2023 10:57

The share price gets blown about but with a good captain at the wheel we will reach our destination and enjoy the journey along the way.

[langland] 14/2/2023 10:51

Market makers (as is their wont) not wanting to report trades -just so they can keep us all in the dark- one of the big irritations of the UK market for this type of share.

[cwa1] 14/2/2023 10:08

Tiny movement off the floor share price wise. The start of a recovery, or just MM's playing games?

[shanklin] 14/2/2023 09:55

97peter

When d9 you expect the IR part of the website to be up to speed please?

[galles] 14/2/2023 09:38

Sounds like a plan. At one point it did cross my mind that you were talking up the shares and offloading at the same time because of the difference in shares you quoted in a matter of weeks

[97peter] 14/2/2023 09:08

Galles I did hold more 9 months ago, but reduced my holding to invest in other shares, tactically. But I am now buying back in and intend to get to around 1,100,000 shares or around 4%. Then I will just sit and take the £30,000 a year to live on. I have always been in and out and luckily now my average at 311,190 shares is46p. Hoping to buy remaining numbers under 50p, to 55p over the next 6 months.

[valuewinsout] 14/2/2023 00:57

Hi 97Peter: Orchard currently has shareholders equity of £16.7M as of Jul-22 (last balance sheet date). It made a profit of £1.518M, this is is return on equity of 1.518/16.7 = 9%, by keeping this capital on it's balance sheet and lending it out.

If Orchard buys back a share at 45p, then it gets 16.7M equity/21.35M shares outstanding = 78p of equity for 45p: or a return of (78-45)/45 = 73% on it's money. Now - they will have to borrow money at ~6% instead of using that balance sheet capital that was used for the buyback, so that they can replace it to maintain the current level of loans. This will reduce that return to about 67%.

That's why: assuming that they can do a share buyback AND maintain current lending levels, they should launch a share buyback. They very fact of buying back some of the shares would signal to the market, that they are determined to boost shareholder value, and would boost the share price. The more shares they can buy back at those levels, the better off all remaining shareholders would be. For example, if they were able to buy back £1M of shares at 44p, then this would be 1/0.44 = 2.27M shares, or 2.27/21.35 = 10.6% of shares outstanding. This means that the future dividends would be 3/(1-0.106) = 3.36p if the dividend total payment remained the same. So they could spend £1M of their capital or 1/16.7 = 6%, and boost the dividend per remaining share by 0.36/3 = 12%.

[galles] 14/2/2023 00:57

Peter, I thought post 235 you posted mentions you are a 3% holder, that's more than 210,000 shares you just said you hold. Or have I misunderstood?

[97peter] 13/2/2023 13:15

Rainmaker, and others on share buy back:
Shareholder Number of Shares Share Capital %
R Takhar 11,458,333. 53.66%
Gresham House Asset Management 3,230,166. 15.13%
Mr Stuart Hawthorne 1,487,000. 6.96%
Chelverton Asset Management 1,250,000. 5.85%
Columbia Threadneedle Investments 916,802. 4.29%
Mrs Jasbir K Takhar 635,418. 2.98%
Res Privata 548,392. 2.57%
Hargreaves Lansdown, stockbrokers (EO) 494,72. 2.32%
Interactive Investor (EO) 262,769. 1.23%
Other (all below 1% each) 1,070,561. 5.01%

I have 210,000 which are a LTH.
So I cannot see why Ravi who owns 54%, plus a relative 3%, why a share buyback would be if use? As they use the money to lend, so profits are future funds and profits and divi’s. Give me 7-8% divi’s before a buyback!
Stuart has 7.5% plus with Gresham, HL and II why share buyback?
Once the SaaS elements are realised and factored into a big boy like Aviva, Direct Line or Admiral, it is lift off time?

[rainmaker] 12/2/2023 20:19

Just a further thought. There is a largish seller around who its reckoned has sold some 300,000 shares. Since there have not been any accompanying company notifications about changes in notifiable interest ie 3% or more then we have to logically conclude that he had less than than 640,000 shares so potentially he has circa up to 300,000 shares left to sell,but no more,assuming that it is the same Person.

AIMHO, DYOR

regards

[rainmaker] 12/2/2023 19:49

Thanks valuewinsout, totally agree, it just makes absolute economic sense. I understand that Ravi is a Warren Buffett fan, well I don't need to ask WB what he would recommend to know his answer.Peter says that now is a good time to buy and I don't think anyone on this thread would disagree then given the significant discount of the share to its net working capital then its an even better time for the company to launch a share buy back programme.

As I noted before, the Company can't help the derisory share price "The Market" currently gives this business,its failure to recognise its current strong trading and bright outlook but it can take full advantage. This situation does remind me of Ben Graham's famous allegory "Mr Market"-see link below-that the Market is there to serve you and not the other way, that you should never take investment advice from "Mr Market" that you should only act when it is in your very best interest to do so and that in the short term the market is a voting machine but in the long run it is a weighing machine. However I do believe that a "share buyback" would completely change market sentiment and send the shares soaring.




AIMHO, DYOR

regards

[valuewinsout] 12/2/2023 00:28

Rainmaker: you make an excellent point. Buying back shares when they are valued significantly below book price is accretive to shareholders. It's preferable to e.g. returning capital via a special dividend, since any subsequent gains in the share price would be taxed as a capital gain, vs a special dividend being taxed as income, which is usually at a higher rate for most shareholders.

I would welcome a share buyback: it would be a signal to the market that the management are concerned with boosting the share price, so it reflects a more realistic valuation.

The only issue with a share buyback is that Orchard uses its capital, to support it's lending: so if it buys back shares it will have to borrow more in order to lend. However, I think that it could easily buy back a limited amount e.g. £1M as you suggest which would be great for the share price, helping to put a floor on the share price closer to book price rather than significantly below it, as it is now. The remaining shareholders would see their shareholding increase in value, as you can currently buy 75p per share of ORCH assets for 44p in the market, due to the current share price. Earnings and dividends would be higher every year subsequently: so I think it's a win-win.

[battlebus2] 08/2/2023 18:23

25k sale after the close again today. Someone with a sizeable amount still offloading imv.

[eeza] 08/2/2023 14:19

I believe in the s/hlder being in charge of his own decision whether to re-invest funds, or not.

[galles] 08/2/2023 13:55

Sounds like you are in favour of increasing the dividends. I am too

[eeza] 08/2/2023 12:41

Yes, but not better than getting the £'s in your own pocket to reinvest as you think fit.

And the other thing about a share BB is, to get the reward of the goosed EPS you have to sell all of your shares - else the gain is only intangible..

[galles] 08/2/2023 12:29

Yes. I guess it won't help with earnings per share, but it'll help knowing the shares are being held and not traded. Better than the situation with a seller around now